IATA today released its assessment of traffic data for August 2009 showing an improvement in continued falling demand compared with July, but fares continue to be depressed.
The association estimates international traffic for August fell 1.1% year-over-year, which is an improvement over the 2.9% drop posted in July. Decreases in freight demand also slowed in August, dropping 9.6% year-over-year compared with an 11.3% decrease in July.
IATA explains carriers have cut daily aircraft utilisation to better match capacity with demand. Using the Boeing 777 widebody as an example, the association estimates average daily hours globally for that specific fleet type fell 2.7% through the first eight months of 2009 to 11.1 hours per day.
However, the association warns that "spreading fixed asset costs over fewer hours in the air pushes up unit costs".
Along with the rising unit costs resulting from lower utilisation carriers also face challenges in raising fares as IATA estimates average fares continue to be depressed. Premium fares fell 22% year-over-year in August with prices for economy tickets dropping 18%.
Carriers in the Asia Pacific, Europe and North America, Latin America and Africa all posted improvements in decreases of passenger demand from July to August. Middle Eastern carriers posted a 10.8% growth in demand year-over-year in August. "This is below the 13.2% recorded in July due to a distortion resulting from the earlier start of Ramadan compared with last year," IATA says. Carriers in the Middle East also continue to win market share on long-haul travel through their expanding hubs, the association explains.
Demand continues to improve, but profitability remains ever distant," says IATA director general Giovanni Bisignani. "Fares have stabilized, but at profitless levels."
Source: Air Transport Intelligence news
